Record Keeping for the Retail Industry

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As a specialist retail accounting firm servicing the retail industry in Melbourne, we sometimes see retailers fail their audits. Approximately 80% of all audits fail because of a lack of documentation, and good cashflow management is one of the keys to your success.

Here are four areas of record keeping that is an important part of the equation in growing a healthy, thriving retail business.

Retailer Cash Register Records

  • Perform a sales reconciliation each day comparing the ‘Z’ total in the cash register with cash on hand. Take into account any business expenses paid for with cash.
  • Write in your sales receipt book regularly the total of sales. Ensure you safe guard the records from potential staff manipulations.
  • Make use of the current technology to save you time. MYOB has a system that directly links with your cash register and eftpos facility.
  • Keep the till rolls as part of your source document records for 7 years to be safe.
  • In case of ATO audit, our clients have been asked in the past to provide source documents such as sales invoices, sales receipts, cash register journal rolls and point of sales system printouts. You will also need to provide daily sales reconciliations and all bank statements.

Receipts Book

  • Transfer the total sales daily into the receipts book.
  • Each month reconcile your bank statements to your receipts book.

Expenses

  • Use a separate bank account for all business activity. Keep private use to set amounts per month.
  • Use direct transfers/cheque books for payments and avoid cash payments.
  • Have a petty cash system to record minor expenses.
  • Keep invoices in a folder system to keep track of documents, or scan them.
  • Each month do a bank reconciliation, which is made easier if you use an accounting system such as MYOB or Cashflow Manager.

Employment Records for Retailers

  • Employees should fill out a tax file number declaration.
  • Paying staff using a computerised accounting system can be very straightforward once setup. Alternatively, you can use a firm such as ADP to do it for you.
  • Ensure that superannuation is paid on time, and don’t fall behind. Directors are personally liable for payments.

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Hillyer Riches is a specialist accounting, business advisory and superannuation firm located in Melbourne. For more information email travis@hillyerriches.com.au

This article is for general information only and should not be relied upon without first seeking advice from an appropriately qualified professional.

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